At Magenta we have written often about empowering women to learn more about money and investments and have greater confidence in planning for their futures. We have also written about using money wisely to make a positive impact on society and the planet.
This article combines these 2 themes as we continue to learn about how women in particular, value financial advice that helps them to encompass the values that are important to them in enriching society and protecting the environment for future generations.
Give women a chance!
We often hear about women being under-represented is so many areas of our society – around the company board table; in politics and certainly in finance.
Yet it is now well understood that investing in women is one of the most meaningful ways to lift up entire communities. With the proper resources and opportunities, women not only support the economy through their direct participation it, but they also tend to pay their good fortune forward.
One of our (male) clients is very active in small money lending schemes to rural communities in India. Interestingly they only lend to women, as they tend to be more reliable; entrepreneurial and focused on the whole community – they make a real difference and set a great example.
Wealthy women are no exception. Many of our clients have a relationship to their wealth that is inextricably linked to their contributions to society at large. Other women, like Melinda Gates; Oprah Winfrey and JK Rowling to name only 3, all make financial decisions with an eye toward making a difference to a cause that is special and/or important to them.
Interestingly, very wealthy men cite tax benefits as the greatest deciding factor in their charitable giving, while women at the same level of wealth most often cite the ability to make the greatest positive impact.
Our experience is that younger women and female entrepreneurs have distinct views on using their wealth to enrich society. For example, more female than male business owners think it’s important for their companies to make both a positive economic and charitable impact on the communities in which they operate.
Wealthy female clients are showing us the way toward a vision of wealth that is more interested in giving back and goes much further than traditional charitable giving. Younger, wealthy women are aligning their spending with the causes they care about and consider positive impact investing to be a form of philanthropy.
They often think much further into the future and in particular about shaping their legacies. They are genuinely worried about societal problems; poor education; poverty and environmental issues that will affect their children and grandchildren and tell us that these causes have become more important to them than simple wealth accumulation in defining a legacy.
It is apparent then, that getting more assets in the hands of more women is good for society at large. So, at Magenta we want to focus on how we can get more women to become confident with money management and investment and encourage more wealth generation among them.
There is no doubt that the secret to wealth accumulation in the long term, is by investment into a well-diversified and monitored portfolio of assets. This is particularly important when interest rates are low and cash in deposit accounts is unlikely to retain its value due to inflation.
The conclusion to this then, is that investments are a key enabler of women’s wealth, and women’s wealth is a key enabler of societal and environmental improvement. For clients, this is a reminder that goals-based investing can help them meet their personal financial objectives and also support their philanthropic efforts. For us at Magenta, it is a reminder to listen closely to client objectives; pay attention to the broader implications of managing client assets, and formulate plans that take a more socially and environmentally conscious approach into account.
Finally, we should all remember not to underestimate the financial power that women can wield, or the impact they can have, especially as investments are an important tool for generating wealth for people in society overall.
If anything in this blog resonates with you, do get in touch for a friendly chat – if we can help you or someone you know, we have a chance of helping society at large and making an even greater positive impact!